TREASURE GLOBAL INC

Previous wording

Through simplifying a user’s e-payment gateway experience, as well as by providing great deals, rewards and promotions with every use, we aim to make the ZCITY App Malaysia’s top reward and loyalty platform. Our longer-term goal is for the ZCITY App and its ever-developing technology to become one of the most well-known commercialized applications more broadly in Southeast Asia and Japan. As of February 10, 2025, we had 2,707,610 registered users and 2,027 registered merchants.

Current wording

Through simplifying a user’s e-payment gateway experience, as well as by providing great deals, rewards and promotions with every use, we aim to make the ZCITY App Malaysia’s top reward and loyalty platform. Our longer-term goal is for the ZCITY App and its ever-developing technology to become one of the most well-known commercialized applications more broadly in Southeast Asia and Japan. As of October 13, 2026, we had 2,715,386 registered users and 2,027 registered merchants.

Previous wording

On February 11, 2025, we signed a share purchase agreement to acquire a 51% stake in Tien Ming Distribution Sdn Bhd to expand FMCG fulfilment and logistics capabilities. The transaction was subsequently terminated and no business combination was recognized for the year ended June 30, 2025.

Current wording

On February 11, 2025, we signed a share purchase agreement to acquire a 51% stake in Tien Ming Distribution Sdn Bhd to expand FMCG fulfilment and logistics capabilities. The transaction is expected to be terminated following the lack of control or significant influence over Tien Ming Distribution Sdn Bhd and no business combination was recognized for the year ended June 30, 2026.

Previous wording

On February 27, 2024, we effected a 1:70 reverse stock split of its shares of common stock. Upon execution of the 1-for-70 reverse stock split (“February 2024 split”). On April 7, 2025, the Company effected a 1:50 reverse stock split of its shares of common stock (“April 2025 split”).

Current wording

On April 7, 2025, we effected a 1:50 reverse stock split of its shares of common stock (“April 2025 Reverse Split”).

Previous wording

We believed it is appropriate to reflect the above transactions on a retroactive basis similar to those after a stock split or dividend pursuant to ASC 260. All shares and per share amounts used herein Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations have been retroactively stated to reflect the effect of the February 2024 Split and April 2025 Split.

Current wording

We believed it is appropriate to reflect the above transactions on a retroactive basis similar to those after a stock split or dividend pursuant to ASC 260. All shares and per share amounts used herein Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations have been retroactively stated to reflect the effect of the April 2025 Reverse Split and December 2025 Reverse Split.

Previous wording

On March 22, 2024, we entered into a marketing offering agreement (“Marketing Offering Agreement”) with H.C. Wainwright & Co., LLC, (the “Manager”). Pursuant to the Marketing Offering Agreement, the Company intends to issue and sell through or to the Manager, as sales agent and / or principal from time to time of the Company’s common stock at the Market Offering. As of June 30, 2025, we have received an aggregated net proceed of approximately $2.9 million, net of broker fee from issuance of 33,566 shares of common stock which sell through or to the Manager.

Current wording

On March 22, 2024, We entered into a marketing offering agreement (“Marketing Offering Agreement”) with H.C. Wainwright & Co., LLC, (the “Manager”). Pursuant to the Marketing Offering Agreement, we intend to issue and sell through or to the Manager, as sales agent and / or principal from time to time of the our common stock at the Market Offering. As of June 30, 2026, the Company received an aggregated net proceed of approximately $2.9 million, net of broker fee from issuance of common stock which sell through or to the Manager.

Previous wording

On October 10, 2024, we entered into a Share Purchase Agreement (the “Purchase Agreement”) with Alumni Capital LP (“Alumni Capital”), a Delaware limited partnership which was subsequently amended by the Modification Agreement on January 21, 2025 . Pursuant to the Purchase Agreement, we have the right, but not the obligation to cause Alumni Capital to purchase up to $50,000,000 common stock, par value $0.00001 (the “Commitment Amount”), at certain purchase Price during the period beginning on the execution date of the Purchase Agreement and ending on the earlier of (i) the date on which Alumni Capital has purchased $50,000,000 of the Company’s common stock pursuant to the Purchase Agreement or (ii) December 31, 2025. As of June 30, 2025, Alumni Capital has purchased approximately $11.7 million worth of the Company’s common stock, totaling 3,163,680 shares. The Company has received approximately $11.7 million in net proceeds as of June 30, 2025.

Current wording

On October 10, 2024, we entered into a Share Purchase Agreement (the “Purchase Agreement”) with Alumni Capital LP (“Alumni Capital”), a Delaware limited partnership which was subsequently amended by the Modification Agreement on January 21, 2025. Pursuant to the Purchase Agreement, we have the right, but not the obligation to cause Alumni Capital to purchase up to $50,000,000 common stock, par value $0.00001 (the “Commitment Amount”), at certain purchase Price during the period beginning on the execution date of the Purchase Agreement and ending on the earlier of (i) the date on which Alumni Capital has purchased $50,000,000 of the Company’s common stock pursuant to the Purchase Agreement or (ii) December 31, 2025. As of June 30, 2026, Alumni Capital has purchased aggregated total of 644,956 shares of our common stock, while we received an aggregated net proceed of approximately $18.8 million.

Previous wording

In October 2024, we have also been developing a cutting-edge Live Streaming Platform enhanced by AI Digital Human Solutions by partnering with V Gallant Sdn Bhd. We will be overseeing the customization of the platform to meet specific requirements, ensuring seamless integration with third-party platforms and optimizing performance across devices. Ongoing support and updates will also be prioritized to maintain consistent functionality. This initiative is central to our efforts to expand our interactive streaming capabilities and elevate user experiences. The development is scheduled to be completed on December 31, 2025.

Current wording

In October 2024, we have also been developing a cutting-edge Live Streaming Platform enhanced by AI Digital Human Solutions by partnering with V Gallant Sdn Bhd. We will be overseeing the customization of the platform to meet specific requirements, ensuring seamless integration with third-party platforms and optimizing performance across devices. Ongoing support and updates will also be prioritized to maintain consistent functionality. This initiative is central to our efforts to expand our interactive streaming capabilities and elevate user experiences. The development was completed on December 31, 2025.

Previous wording

On October 29, 2024, we entered into a service agreement with V Gallant Sdn Bhd to provide generative AI solutions and AI digital human technology services. On March 24, 2025, we executed a supplemental letter expanding the scope of that agreement to require V Gallant to provide and manage GPU servers, network infrastructure, cloud integration, security measures, AI tools, and user environments to support AI cloud infrastructure.

Current wording

On October 29, 2024, we entered into a service agreement with V Gallant Sdn Bhd to provide generative AI solutions and AI digital human technology services.

Previous wording

We have experienced a decrease in growth rate in registered users, and a decline of active users over our last five quarters as of June 30, 2025. As of June 30, 2025, we recorded 2,708,053 registered users and 4,887 active users on the ZCITY platform. On average, our registered user base has grown by approximately 0.1% over the past five quarters, while our active user numbers have experienced an average decrease of 32.0%.

Current wording

We have experienced a decrease in growth rate in registered users, and a decline of active users over our last five quarters as of June 30, 2026. As of June 30, 2026, we recorded 2,710,183 registered users and 3,054 active users on the ZCITY platform. On average, our registered user base has grown by approximately 0.02% over the past five quarters, while our active user numbers have experienced an average decrease of 21.8%.

Previous wording

Transaction revenue primarily consists of fees charged to merchants for participating in our ZCITY platform upon successful sales and service transactions, as well as for payment services facilitated between merchants and their customers online. Our transaction revenue increased by 107.6%, reaching approximately $127,000 for the years ended June 30, 2025, compared to approximately $61,000 for the same period in 2024. This growth was driven by our recent partnership with Credilab Sdn. Bhd. (“CLSB”), a third-party credit services provider. Through this partnership, we introduced our portfolio clients from TADAA Technologies to CLSB’s credit service platform. In return, CLSB agreed to pay us a transaction fee upon successful transactions and share 50% of the revenue derived from these Portfolio Clients.

Current wording

Transaction revenue primarily consists of fees charged to merchants for participating in our ZCITY platform upon successful sales and service transactions, as well as for payment services facilitated between merchants and their customers online. In addition, transaction revenue includes fees earned through our recent partnership with Credilab Sdn. Bhd. (“CLSB”), a third-party credit services provider. Under that agreement, we refer our portfolio clients from TADAA Technologies Sdn. Bhd. (ZCITY’s operating subsidiary) to CLSB’s credit service platform; in return CLSB pays us a transaction fee for each successful transaction and agrees to share 50 % of the revenue derived from those portfolio clients.

Previous wording

During the fiscal year, the Company initiated a new revenue stream in the ordinary course of business by offering customized software development services, primarily targeting enterprise clients. As of January 2025, we have entered into a new service partnership with Reveillon Group Limited to design, develop, and implement a comprehensive digital system. This initiative involves the creation of integrated modules focused on improving administrative processes, data analysis, and user engagement. The system is being built with scalability, customization, and long-term performance in mind, ensuring it meets evolving business needs. This collaboration underscores our ongoing commitment to delivering robust and adaptable digital solutions across various industries. The project is scheduled for completion within 12 months of the agreement’s start date.

Current wording

During the fiscal year ended June 30, 2025, the Company initiated a new revenue stream by offering customized software development services, primarily targeting enterprise clients. In January 2025, the Company entered into a service partnership with Reveillon Group Limited to design, develop, and implement a comprehensive digital system, including integrated modules to enhance administrative processes, data analysis, and user engagement. The project is designed with scalability and customization to support long-term performance and evolving business needs, and is expected to be completed within 12 months from the commencement date.

Previous wording

Total revenues decreased by approximately $19.7 million or 89.4% to approximately $2.3 million for the years ended June 30, 2025 from approximately $22.1 million for the years ended June 30, 2024. The decrease was mainly attributable to the decrease in product and loyalty program revenue offset by increase in revenue from customized software development service .

Current wording

No revenue from customized software development services was recognized for the years ended June 30, 2026.

Previous wording

Cost of revenue primarily consists of purchases of gift cards or “E-voucher” PIN codes, healthcare products, and food and beverage products, which are directly attributable to our product revenue. It also includes monthly license payments made to our licensor to maintain our right to use the Trademark, which supports our sublicense revenue. In addition, cost of revenue includes both in-house labor and outsourced labor costs related to customized software development services. Total cost of revenue decreased by approximately $21.0 million, or 96.9%, for the years ended June 30, 2025, compared to the same period in 2024. The decrease was consistent with the decline in our revenue.

Current wording

Cost of revenue primarily consists of purchases of gift cards or “E-voucher” PIN codes, and healthcare products, which are directly attributable to our product revenue. Total cost of revenue increased by approximately $4.5 million, or 681.1%, for the years ended June 30, 2026 compared to the same period in 2025. The increase was mainly due to increase of product and loyalty program revenue and higher product cost.

Previous wording

Our gross profit for the year ended June 30, 2025, amounted to approximately $1.7 million as compared to approximately $0.8 million for the same period in 2024, reflecting an increase of approximately $0.8 million or 104.6%. Our gross margin improved to 71.6% for the year ended June 30, 2025 from 3.7% for the same period in 2024, representing an enhancement of 67.9% in our gross margin percentage.

Current wording

Our gross profit for the year ended June 30, 2026 was approximately $9,000, compared to approximately $1.7 million for the year ended June 30, 2025, representing a decrease of approximately $1.7 million, or 99.5%. Our gross margin decreased to approximately 0.2% for the year ended June 30, 2026 from approximately 71.6% for the year ended June 30, 2025.

Previous wording

Selling expenses amounted to approximately $0.1 million and $1.8 million for the years ended June 30, 2025 and 2024, respectively, representing a decrease of approximately $1.6 million or 92.6%. The decrease was mainly attributable to a decrease in marketing and promotion expense of approximately $1.2 million related to promoting our ZCITY platform. Marketing and promotion expense consists of redemptions of reward points which is generated from non-spending related activities (registration as a new user, referral of a new user and Spin & Win eligibility to receive reward points) in exchange for discounted credit of purchasing our products upon conversion of using the reward points. For the years ended June 30, 2025 and 2024, we incurred approximately $34,000 and $0.4 million, respectively, in marketing and promotion expense, and recognized the same amount of product revenue at the time of redemption of the non-spending related activities reward points by our customers. The decrease in marketing and promotion expenses was primarily driven by our strategic goal to optimize the promotional activities, enhance our cost effectiveness, and increase profitability in our operations.

Current wording

Selling expenses amounted to approximately $1.3 million and $0.1 million for the years ended June 30, 2026 and 2025, respectively, representing an increase of approximately $1.1 million, or 876.3%. The increase was mainly attributable to an increase in digital marketing expense of approximately $1.1 million and other marketing and promotion expense related to promoting our ZCITY platform. Marketing and promotion expense consists of redemptions of reward points which is generated from non-spending related activities (registration as a new user, referral of a new user and Spin & Win eligibility to receive reward points) in exchange for discounted credit of purchasing our products upon conversion of using the reward points. For the years ended June 30, 2026 and 2025, we incurred approximately $26,000 and $34,000, respectively, in marketing and promotion expense, and recognized the same amount of product revenue at the time of redemption of the non-spending related activities reward points by our customers.

Previous wording

Research and development expense amounted to approximately $0.2 million and $0.5 million for the years ended June 30, 2025 and 2024, respectively, representing 58.0% increase as we incurred more spending in A.I related infrastructure development. The increase primarily reflects costs for software engineering, cloud infrastructure and GPU-related development supporting the live-streaming/AI program described in “Business Development.”

Current wording

Research and development expense amounted to approximately $1.6 million and $0.2 million for the years ended June 30, 2026 and 2025, respectively, representing a 662.5% increase as we incurred more spending in A.I related infrastructure development. The increase primarily reflects costs for software engineering, cloud infrastructure and GPU-related development supporting the live-streaming/AI program described in “Business Development.”

Previous wording

Stock-based compensation expenses amounted to approximately $0.3 million and $0.1 million for the years ended June 30, 2025, and 2024, respectively. The stock-based compensation incurred for the years ended June 30, 2025 and 2024, was related to compensation paid to our executive officer as part of their compensation plan and third party for professional service. The increase in stock-based compensation during the year ended June 30, 2025, was primarily attributable to the our decision to grant additional equity incentives to our executive officer in order to align their interests with those of our shareholders and to encourage their continued commitment toward supporting the our long-term growth.

Current wording

Stock-based compensation expenses amounted to approximately $1.8 million and $0.2 million for the years ended June 30, 2026 and 2025, respectively, representing an increase of approximately $1.6 million, or 785.6%. The stock-based compensation incurred for the years ended June 30, 2026 and 2025, was related to compensation paid to our executive officers and other employees as part of their compensation plan and third party for professional service.

Previous wording

Provision for income taxes amounted to approximately $349,000 and $40,000 for the years ended June 30, 2024 and 2023. The amount was mainly attributable to tax imposed on us from the State of Delaware, as we are required to remit franchise tax to the State of Delaware on an annual basis. We also were subject to controlled foreign corporations Subpart F income (“Subpart F”) tax, which is a tax primarily on passive income from controlled foreign corporations with a tax rate of 35%. In addition, the Tax Cuts and Jobs Act imposed a global intangible low-taxed income (“GILTI”) tax, which is a tax on certain off-shore earnings at an effective rate of 10.5% for tax years (50% deduction of the current enacted tax rate of 21%) with a partial offset for 80% foreign tax credits. If the foreign tax rate is 13.125% or higher, there will be no U.S. corporate tax after the 80% foreign tax credits are applied. For the years ended June 30, 2025 and 2024, our foreign subsidiaries did not generate any income that are subject to Subpart F tax and GILTI tax.

Current wording

Provision for income taxes amounted to approximately $200,000 and $349,000 for the years ended June 30, 2026 and 2025, respectively. The amount was mainly attributable to tax imposed on us from the State of Delaware, as we are required to remit franchise tax to the State of Delaware on an annual basis. We also were subject to controlled foreign corporations Subpart F income (“Subpart F”) tax, which is a tax primarily on passive income from controlled foreign corporations with a tax rate of 35%. In addition, the Tax Cuts and Jobs Act imposed a global intangible low-taxed income (“GILTI”) tax, which is a tax on certain off-shore earnings at an effective rate of 10.5% for tax years (50% deduction of the current enacted tax rate of 21%) with a partial offset for 80% foreign tax credits. If the foreign tax rate is 13.125% or higher, there will be no U.S. corporate tax after the 80% foreign tax credits are applied. For the years ended June 30, 2026 and 2025, our foreign subsidiaries did not generate any income that are subject to Subpart F tax and GILTI tax.

Previous wording

We generated net loss of approximately $23.4 million and $6.6 million for the years ended June 30, 2025 and 2024, respectively, representing a change of approximately $6.4 million. The change was primarily attributable to the factors discussed above.

Current wording

We generated net loss of approximately $11.1 million and $23.4 million for the years ended June 30, 2026 and 2025, respectively, representing a decrease of approximately $12.3 million. The change was primarily attributable to the factors discussed above.

Previous wording

As of June 30, 2025 and 2024, we had approximately $0.2 million, in cash and cash equivalent which primarily consists of bank deposits, which are unrestricted as to withdrawal and use.

Current wording

As of June 30, 2026 and June 30, 2025, we had approximately $1.6 million and 0.2 million, respectively, in cash and cash equivalent which primarily consists of bank deposits, which are unrestricted as to withdrawal and use. As of June 30, 2026 and June 30, 2025, we had working capital of approximately $4.6 million and $1.9 million, respectively.

Previous wording

Despite receiving the proceeds from various offerings, management is of the opinion that we will not have sufficient funds to meet the working capital requirements and debt obligations as they become due starting from one year from the date of this report due to our recurring loss. Therefore, management has determined there is substantial doubt about our ability to continue as a going concern. If we are unable to generate significant revenue, we may be required to curtail or cease our operations. Management is trying to alleviate the going concern risk through the following sources:

Current wording

Despite receiving the proceeds from various offerings, management is of the opinion that we will not have sufficient funds to meet the working capital requirements and debt obligations as they become due starting from one year from the date of this report due to our recurring loss. Therefore, management has determined there is substantial doubt about our ability to continue as a going concern. If we are unable to generate significant revenue, we may be required to curtail or cease our operations. Management is trying to alleviate the going concern risk through equity financing to support its working capital.

Previous wording

Net cash used in operating activities for the years ended June 30, 2025 was approximately $9.3 million and was mainly comprised of the net loss of approximately $23.4 million, non-cash item of gain in change in fair value of derivative liabilities of approximately $1.8 million, increase in accounts receivable of approximately $1.6 million due to additional sales to new service partnership with Reveillon Group Limited but not yet collected, increase of other receivable and other assets of approximately $7.0 million which mainly includes approximately $3.6 million prepayment to certain vendors for technical and maintenance service and approximately $5.7 million of collaboration deposit made to Credilab Sdn. Bhd. (“CLSB”), decrease in customer deposits of approximately $75,000, as we recognized member service revenue in the current period from certain merchant prepayments made in the prior period, and decrease in contract liabilities of approximately $0.2 million, primarily as a result of increased revenue recognized from the ZCITY reward program due to a higher volume of customer reward redemptions, offset by non-cash items of depreciation, amortization, allowance for credit losses, stock-based compensation, long-live assets impairment and unrealized loss on marketable securities amounted to approximately $21.6 million, decrease of prepayment of approximately $0.1 million due to the utilization of prior-period prepayments for inventory purchases, and (iii) increase of approximately $2.9 million in other payables and accrued liabilities as we made approximately $2.7 million provision related to settlement of cash compensation requested by V Gallant Sdn. Bhd. pursuant to the Service Agreement dated October 29, 2024, as supplemented on March 28, 2025, to reflect the decline in our share price.

Current wording

Net cash used in operating activities for the year ended June 30, 2025 was approximately $9.5 million and was mainly comprised of the net loss of approximately $23.4 million, non-cash item of gain in change in fair value of derivative liabilities of approximately $1.8 million, increase in accounts receivable of approximately $1.6 million due to additional sales to new service partnership with Reveillon Group Limited but not yet collected, increase of other receivable and other assets of approximately $7.0 million which mainly includes approximately $3.6 million prepayment to certain vendors for technical and maintenance service and approximately $5.7 million of collaboration deposit made to Credilab Sdn. Bhd. (“CLSB”), decrease in customer deposits of approximately $75,000, as we recognized member service revenue in the current period from certain merchant prepayments made in the prior period, and decrease in contract liabilities of approximately $0.2 million, primarily as a result of increased revenue recognized from the ZCITY reward program due to a higher volume of customer reward redemptions, offset by non-cash items of depreciation, amortization, allowance for credit losses, stock-based compensation, long-live assets impairment and unrealized loss on marketable securities amounted to approximately $21.6 million, decrease of prepayment of approximately $0.1 million due to the utilization of prior-period prepayments for inventory purchases, and (iii) increase of approximately $2.9 million in other payables and accrued liabilities as we made approximately $2.7 million provision related to settlement of cash compensation requested by V Gallant Sdn. Bhd. pursuant to the Service Agreement dated October 29, 2024, as supplemented on March 28, 2025, to reflect the decline in our share price.

Previous wording

Net cash used in investing activities for the year ended June 30, 2025 was approximately $5.9 million which mainly due to remittance of approximately $5.7 million to CLSB as a collaboration deposit to support CLSB’s credit service activities for the Portfolio Clients, and approximately $0.2 million prepayment of purchase consideration for acquisition of Tien Ming Distribution Sdn Bhd.

Current wording

Net cash used in investing activities for the year ended June 30, 2025 was approximately $5.8 million which mainly due to remittance of approximately $5.7 million to CLSB as a collaboration deposit to support CLSB’s credit service activities for the Portfolio Clients, and approximately $0.2 million prepayment of purchase consideration for acquisition of Tien Ming Distribution Sdn Bhd.

Previous wording

The preparation of these consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in our consolidated financial statements include the estimated retail price per point and estimated breakage to calculate the revenue recognized in our loyalty program revenue, the useful lives of property and equipment, impairment of long-lived assets, provision for estimated credit losses, write-down for estimated obsolescence or unmarketable inventories, realization of deferred tax assets and uncertain tax position, fair value of our stock price to determine the beneficial conversion feature (“BCF”) within the convertible note, fair value of the stock-based compensation, fair value of the marketable securities and fair value of the warrants issued. Actual results could differ from these estimates.

Current wording

The preparation of these consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in our consolidated financial statements include impairment of long-lived assets, provision for estimated credit losses, realization of deferred tax assets, fair value of the stock-based compensation, , fair value of the warrants issued, derivative assets and derivative liabilities. Actual results could differ from these estimates.

Previous wording

Accounts receivable are recorded at the invoiced amount, net of an allowance for uncollectible accounts and do not accrue interest. We offer various payments terms to customers from cash due on delivery to 90 days based on their credit history. Accounts receivable encompass amounts due from sales of healthcare products on our ZCITY platform. Management also periodically evaluates individual customer’s financial condition, credit history and the current economic conditions to make adjustments in the allowance when it is considered necessary. Account balances are charged off against the allowance when all collection efforts have been exhausted, and recovery potential is deemed remote. Our management reviews historical accounts receivable collection rates across all aging brackets and has made 100% provision of credit loss for customer balances aged above 120 days for sales of healthcare products on our ZCITY platform. Our management continuously assesses the reasonableness of the credit loss allowance policy and updates it as needed. As of June 30, 2025 and 2024, we recorded $9,924 and $1,100 of provision for estimated credit losses, respectively.

Current wording

Accounts receivable are recorded at the invoiced amount, net of an allowance for uncollectible accounts and do not accrue interest. We offer various payments terms to customers from cash due on delivery to 90 days based on their credit history. Accounts receivable encompass amounts due from sales of healthcare products on our ZCITY platform. Management also periodically evaluates individual customer’s financial condition, credit history and the current economic conditions to make adjustments in the allowance when it is considered necessary. Account balances are charged off against the allowance when all collection efforts have been exhausted, and recovery potential is deemed remote. Our management reviews historical accounts receivable collection rates across all aging brackets and has made 100% provision of credit loss for customer balances aged above 120 days for sales of healthcare products on our ZCITY platform. Our management continuously assesses the reasonableness of the credit loss allowance policy and updates it as needed. As of June 30, 2026 and June 30, 2025, we recorded $735,214 and $9,924 of provision for estimated credit losses, respectively.

Previous wording

Other receivables and other current assets consist of prepayment to third parties for cyber security service, director & officer liability insurance (“D&O Insurance”), and other professional fee. Other receivables and other current assets also include refundable advance to third party service provider, and other deposits. Starting from July 1, 2023, we had adopted ASC Topic 326 on our other receivables using the modified retrospective approach. The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based on the expected losses rather than incurred losses. Under the new accounting guidance, we measure credit losses on its other receivables using the current expected credit loss model under ASC 326. As of June 30, 2025 and 2024, we have provided allowance for credit loss of $1,078,353 and $212,758, respectively.

Current wording

Other receivables and other current assets consist of prepayment to third parties for cyber security service, director & officer liability insurance (“D&O Insurance”), and other professional fee. Other receivables and other current assets also include refundable advance to third party service provider, and other deposits. Starting from July 1, 2023, we had adopted ASC Topic 326 on our other receivables using the modified retrospective approach. The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based on the expected losses rather than incurred losses. Under the new accounting guidance, we measure credit losses on its other receivables using the current expected credit loss model under ASC 326. As of June 30, 2026 and 2025, we have provided allowance for credit loss of $3,794,619 and $1,078,353, respectively.

Previous wording

Long-lived assets, including property and equipment with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. We assessed the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, we would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. $19,517,303 and $0 impairment for long-lived assets were recorded as of June 30, 2025 and 2024, respectively.

Current wording

Long-lived assets, including property and equipment with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. We assessed the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, we would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. $3,044,877 and $19,517,303 impairment for long-lived assets were recorded as of June 30, 2026 and 2025, respectively.

Previous wording

The fair value of the warrants issued to Alumni Capital which was determined on grant dates by using the Black Scholes model using the following assumptions: (1) expected volatility of 160.20% to 171.88%, (2) risk-free interest rate of 3.72% to 4.37%, (3) expected life of 2.4 years to 2.8 years, (4) exercise price of $2.22 to $5.15 and (5) stock price of $1.62 to $19.50 on grant date, the date of which the warrants were issued. Based on above assumption, the fair value of the warrants was estimated to be $2,450,227.

Current wording

The fair value of the warrants issued to Alumni Capital which was determined on grant dates by using the Black Scholes model using the following assumptions: (1) expected volatility of 160.20% to 182.34%, (2) risk-free interest rate of 3.52% to 4.37%, (3) expected life of 2.0 years to 2.8 years, (4) exercise price of $23.37 to $103.00 and (5) stock price of $21.60 to $390.00 on grant date, the date of which the warrants were issued. Based on above assumption, the fair value of the warrants on grant date were estimated to be $13,247,339.

Previous wording

The fair value of the warrants issued to Alumni Capital which was determined on June 30, 2025 by using the Black Scholes model using the following assumptions: (1) expected volatility of 162.92% to 167.27%, (2) risk-free interest rate of 3.71%, (3) expected life of 2.3 years, (4) exercise price of $1.20 to $2.05 and (5) stock price of $1.10 on June 30, 2025. Based on above assumption, the fair value of the warrants were estimated to be $383,885.

Current wording

The fair value of the warrants issued to Alumni Capital was determined as of June 30, 2025 using the Black-Scholes model with the following assumptions: (1) expected volatility of 162.92% to 167.27%, (2) risk-free interest rate of 3.71%, (3) expected life of 2.3 years, (4) exercise price of $24.00 to $41.00, and (5) stock price of $22.00 as of June 30, 2025, as adjusted to give retroactive effect to the 1-for-20 reverse stock split effected on December 5, 2025. Based on the above assumptions, the fair value of the warrants was estimated to be $383,886.